Sen. John McCain's report calls for a new board of directors at the Navajo Housing Authority, possible cutbacks in Navajo housing funds by Congress, and the creation of a separate agency to handle new-home development for the tribe.(Photo: Michael Chow/The Republic)

Sen. John McCain on Thursday released an investigative report on alleged mismanagement in the Navajo Nation's housing agency that calls for sweeping reforms to protect federal funds and provide adequate homes for tribal members.

McCain, R-Ariz., said the probe by his office "confirms that the Navajo Housing Authority remains a broken public housing agency that is grossly misusing taxpayer funds. Navajo Nation is facing a housing crisis," he added, "but the NHA has not delivered on its promise of providing affordable, livable homes for its people."

McCain's report calls for a new board of directors at NHA, possible cutbacks in Navajo housing funds by Congress, and the creation of a separate agency to handle new-home development for the tribe.

Posted!

A link has been posted to your Facebook feed.

Pauletta Tsosie looks over the footprint of her 1,283-square-foot house as it was being built by the Navajo Housing Authority in St. Michaels, Ariz., in spring 2015. She originally applied for a house in 2002. As of November 2016, she still was waiting to move in. Michael Chow/The Republic

Another view of Pauletta Tsosie's home in the early phases of construction in spring 2015. In fall 2016, she remained unable to move in because of water-line and septic-system problems. Michael Chow/The Republic

Pauletta Tsosie's new house in St. Michaels, Ariz., was largely completed by spring 2016, but as of November 2016 she still had not been able to move in. She applied for the home through the Navajo Housing Authority. Michael Chow/The Republic

Interested in this topic? You may also want to view these photo galleries:

For example, NHA records last year showed 50 dwellings were modernized with $55 million in tax dollars, which works out to $1.1 million each. Twenty-six new homes were built with nearly $20 million, a per-unit price of $750,000.

McCain's staff reported similar findings: Over the past decade, NHA received $803 million dollars in Native American housing grants, yet built just 1,100 new homes — "far fewer than is needed to address the Navajo Nation's chronic housing shortage."

NHA has claimed the Navajo Nation needs 34,100 new homes and nearly as many refurbishments, at a total cost of $9 billion. The agency receives more than $80 million each year for housing.

McCain's report alleges that, because of poor planning and mismanagement, NHA has failed to spend money it gets and exposed federal tax dollars to "an excessive risk of waste, fraud and abuse."

Though Senate investigators did not uncover criminal conduct, the report says, their findings "warrant additional independent review and support calls by Navajo leaders for overhauling NHA’s leadership and improving the NHA’s oversight structure."

NHA Executive Director Aneva "AJ" Yazzie has blamed failures on prior leadership at NHA, and unique development challenges on a Navajo Nation that sprawls over portions of Arizona, New Mexico and Utah. In an interview with Navajo Times last month, Yazzie said The Republic's reporting contained "inaccurate information and half-truths."

Solar lights charge in the sun outside Peter Ashley's house on the Navajo Reservation. His home has no electricity or running water, so he uses the small lights and a kerosene lamp for light at night. Michael Chow/The Republic

Preston Ashley, 57, plays cards under a kerosene lamp in his hogan near Sanders, Ariz., on the Navajo Reservation. Ashley says he plays cards to entertain himself almost every night. Michael Chow/The Republic

Interested in this topic? You may also want to view these photo galleries:

Navajo Nation President Russell Begaye, who has been pressing for major reforms at the housing agency, said he welcomes the McCain investigation and takes the findings “very seriously,” adding, “Our number one concern has always been that the Navajo people receive adequate housing.”

However, Begaye said he and the tribal council already have initiated corrective actions. He criticized any proposal to cap or cut tribal housing funds.

“We feel this is a mistake because our people who need these homes shouldn’t pay the price for the seemingly inefficient operation or failure of NHA,” he explained. “We are asking that the funding continue at the current level because the need remains critical.”

HUD officials, who launched a separate probe of NHA in March, said that review is not completed.

The Republic obtained a draft copy of HUD's review. It says department officials found no statutory or regulatory violations and no concerns about NHA program deficiencies. An agency spokeswoman declined further comment. Rodger Boyd, former deputy assistant secretary at HUD — and now a consultant to the tribal Housing Authority — could not be reached.

McCain's probe found that NHA lacks the planning and capacity to achieve its mission, which is to overcome severe housing shortages on a Native nation the size of West Virginia.

Among the recommendations:

Congress should consider capping or reducing federal housing allocations to NHA if new home construction does not increase or federal funds remain unspent.

Replacement of the authority's board with new members who have professional qualifications. (The Navajo Nation Council and President Begaye already have initiated those changes, with three of five new commissioners appointed so far.)

The Navajo Nation Council should consider creating a new tribal housing agency for new housing, and limit NHA's role to management of existing rental units.

HUD should increase its monitoring of NHA and ensure its performance reports are accurate.

The report says NHA board members spent money on trips to Hawaii and Las Vegas that "created at least an appearance of impropriety." (The housing authority refused to provide congressional investigators with related accounting records.)

Posted!

A link has been posted to your Facebook feed.

Anita James, 60, lifts the lid to a bucket where she keeps her drinking water. She shares a home near Houck, Ariz., with her sister. However, the home has no running water, so water is trucked in and transferred to containers to store in their home. Michael Chow/The Republic

Patricia Yazzie, 73, sits outside the 18-by-32-foot home she shares with her sister, Anita James, near Houck, Ariz. The sisters say they have no interest in moving into a new development proposed nearby because it would be too expensive for them. Michael Chow/The Republic

"I don't want to be pushed out of my house," said Patricia Yazzie, who lives with her sister near Houck. The sisters live for free in their current home, and do not intend to move into a new development proposed by the Navajo Housing Authority. Michael Chow/The Republic

Construction of the Bluestone Development proposed by the Navajo Housing Authority has not yet begun. A ribbon-cutting ceremony at the location near Houck, Ariz., was held in 2014. Michael Chow/The Republic

Interested in this topic? You may also want to view these photo galleries:

According to investigators, NHA has spent $125 million over five years to design the project, yet no actual construction has occurred. The report says development stalled because NHA did not do proper market analyses or title searches and failed to ensure a water supply or waste treatment system. Those problems arose despite nearly $14 million in NHA contracts with planning, design and engineering firms.

Yazzie in the past has blamed HUD for a lack of assistance and oversight. McCain's investigation says, "We disagree with NHA that the fault lies solely with HUD. The problem arises from (NHA) deficiencies in planning and capacity. ... The poor administration of (Indian Housing Block Grant) funds by NHA has exposed the program to an excessive risk of waste, fraud and abuse."